Brad Johnson: Derek, Michelle, welcome back. Good to see you guys again.
Michelle Short: Good to see you too.
Derek Gregoire: It’s been a while on one of these things.
Brad Johnson: It has been a while on one of these things. Well, I wanted to get back for a conversation as we record this on my birthday.
Michelle Short: Happy birthday!
Derek Gregoire: Happy birthday!
Brad Johnson: August 13 of 2026. Number one, I was looking forward to celebrating it with you guys via podcast. But also, as we look, we’re two-thirds of the way through the year right now, and you guys had some really big news end of last year. I know there was a press release that went out, and I can say personally, from being a guy that’s been in this industry almost 20 years now, one of the coolest acquisition stories I’ve seen. We won’t get into all probably the numbers. We’ll try to keep that private, but I will say it was one of the most successful exits I’ve seen in a long time. And I know you guys are still working through that. But I thought it would be worth taking some time to talk through the learnings.
As you were going through those conversations, you guys have built a really successful business that’s much bigger than just the two of you, that when people look at it financially, they’re like, “Wow, how do they do that?” But I also know we’ve had a lot of conversations where you’re like, “Wow, we learned a lot going through this of how we, the metrics that matter, the levers we need to pull for our business to be valuable in the eyes of others.” So, thought it was worth diving into. So, I guess there’s your queue up. Where do we want to take it from here? What were some of those learnings as you all went through that?
Derek Gregoire: Well, we’re excited to get to the table in Austin. I mean, sorry, Austin. Geez, that’s where the company that bought us is from. In Kansas City. And, obviously, share a little bit deeper with I think people want to know some of the background and some of the decisions that were made, and looking back to build our company for an exit, what we would’ve maybe done differently, knowing what we know now. So, once again, happy birthday, Brad. You did catch me. I’ll be 47 in a couple months, so it’s not going to be for long.
Brad Johnson: I caught you for a little bit.
Derek Gregoire: And it’s funny, it’s recent, but we had… Well, I’m an old 46, I always say, because we’ve been running this business for so long. And I was doing the TV show the other day, and I kept saying back when we started our firm in 2004, I mentioned it three times, but that’s when I was married. We actually started the company in 2003. So, there’s going to be some incorrect data out there.
Brad Johnson: You’ve had two marriages going on at the same time, the marriage to the business and to Kylene.
Derek Gregoire: I got the wrong one for that date. But back in 2003 when we started the firm, I think everyone always looks at the now and how it looks now and forgets the back in the day. And so, I think impressive, not from myself, but from the team standpoint, is that from 2003 to 2013, we had a name of a company, and we had a shingle hanging, but there was not really a business. And 2013, we had just gotten the license. Matt was the first one to be able to do AUM. It was all annuities and life before that. We had people that worked there, but not even their fault. We just didn’t know how to run the business and operational side. And fast-forward, we hired Michelle in end of 2013. She was about to start, and then she’s like, “Oh, I’m having a baby.”
But she was that good. We’re like, “Don’t worry. We’ll wait until you’re ready to come back.” And 2014 is really when we set the motion in to build the company. So, it really wasn’t a 20-plus-year run. It was really like a 12-year run, 10, 11-year run. You know what I mean? Because that’s when the real business started. We probably had, when Michelle started, less than 30 million of AUM. So, beginning of 2014 is when we really started to build a business, just to kind of go backwards. So, just to give a…
Brad Johnson: I’m kind of grateful, Derek. I wasn’t there for the last decade. I kind of met you guys in 2012. So, I let you guys get all that out your way. And then Michelle came in, and then we started building something together.
Derek Gregoire: Well, you came in, too. I didn’t get to that part.
Brad Johnson: Yeah.
Derek Gregoire: No, but that we met you during that same process. Right before Michelle, we met you, and there was a lot of transformation right there with just like simple things now that are probably prevalent to some firms of naming your process, right? Just making sure every process is for every single thing we do in our office is written down and notated. So, there’s so much to get into in terms of what we learned. But just trying to set the tone for the early days of SHP is so much different than what it looks like now, and even Michelle, I’m sure. And then when she came on in 2014 to now is completely different.
Brad Johnson: Yeah. Well, let’s kick it over to Michelle. So, for those that maybe if this is their first time watching or hearing about SHP, Derek’s one of the three founders. Michelle came in early, started as Director of Ops, and then as the company grew, grew into COO. One of the things that I saw from my chair, three great guys in partnership, three great salespeople that wanted to do their very best for clients. But as you know, you can make promises on the front end, but if you don’t deliver on them on the back end, on the operations side, it all falls apart. And that’s, Michelle, where you really came in as the glue, really saw the team as your client. So, maybe we do just a quick touch on the business you came into, and then maybe go into what you all learned through kind of the acquisition process. What are the metrics that matter the most?
Michelle Short: Okay. Yeah, I mean joining in 2014, Derek said it best. We had folks here that were just here to get a paycheck, you know? They were just here to work 9:00 to 5:00, see you later. Didn’t really want to contribute to the growth. They didn’t see the growth. And in fairness, Derek, Keith, Matt, they didn’t know what their growth was going to be. They didn’t really see the vision. They just were kind of getting through the day-by-day, mundane of just running appointments, selling, running appointments, selling. They were driving all over the place. We have three office locations. They’re driving north, south, all over the place. So, it’s like we had to streamline their workflow. Really, really create a new avenue of marketing and what that looks like.
And we had to really clean house, and we had to terminate some employees that weren’t here for the right reasons. And then we brought in some folks to grow with, right? So, as we started, I mean, we all wore many, many hats. I’m qualifying leads, I’m attending seminars, I’m answering the phones. I’m ordering the supplies. Like, we all wore so many different hats. But slowly, we kind of just added certain people to the team to take more off Derek, Keith, and Matt’s plate. They knew they wanted to grow at that point, but we were like, “What does that look like?” so we started putting numbers together, a vision together, started tracking things differently, putting in those processes and procedures in place to kind of develop the team.
They’ve given me so much leeway and flexibility, which was real exciting in the beginning for me because I was like, “Well, I want to really help you get to that next level together.” So, you fast-forward, and we’re going to show at the table our matrix of how we grew and at what year we added what bodies and different milestones along the way that were instrumental to the growth and to start scaling. So, having that in place and then slowly like, “Okay, wow. We can actually hit these numbers together,” and then we need to add more bodies, and then we need more office space, right? And it’s like trying to streamline the whole operation to really where it makes sense.
And then you fast-forward to the 2000s, and I think you’ll see this in our growth trajectory. It’s like we started adding specialists to the team. So, it’s no longer just hiring. I think we were at a point where we were just hiring to get bodies in the door just to do the work, but now it’s very intentional to bring specialists in each role. Whether it’s our investment committee or it’s our advisory team or the new business team, these folks are truly specialists in the role that they’re in, which has been a nice thing to watch, and that really set you guys up for the sale, which is something we’ll talk more about as well.
Brad Johnson: Yeah. So, keyword there that I think, when I see this, I think every advisor, I mean, pretty much every advisor I’ve ever asked that’s a founder, like a Derek, would be that if I said, “Hey, do you want to go from a financial advisor to a true business owner?” 100 out of 100 times like, “Yeah, that sounds great because I don’t want this thing just to be on my shoulders.” But the gap there, you guys already nailed a bunch of them. An actual process that’s not just my personality connecting with people and saying, “Hey, come on as a client of mine.” Operations being dialed in, but then as you start to grow and scale, one of the biggest gaps I see there often, and here’s a clue: if you talk about roles in your company by somebody’s first name. “Hey, oh, there’s Sally over there. We need Sally to do this,” versus, “Here is the specialized role with job description that, hey, does Sally’s skill set fit that?”
And I’ll see that in kind of firms just starting to grow. They’ll name roles by team member name versus role of actual role, and then with this team member that actually should be in that role. So, maybe we, because I know our time is short here, so I’m going to go kind of rapid fire.
Derek Gregoire: Yeah. Go for it.
Brad Johnson: This will be a little bit of a preview for the table, which will be out, Casey, right in our backyard, which rumor has it we might be visiting your two favorite football players’ steakhouse in Kansas City. I’m talking about Patrick Mahomes and Travis Kelce.
Derek Gregoire: There you go. 1287.
Brad Johnson: What’s that?
Derek Gregoire: 1287 Brady Gronk.
Brad Johnson: 1287.
Derek Gregoire: Brady, Gronk.
Brad Johnson: Wow. Did Keith just join us out of the blue?
Derek Gregoire: Keith just crept into the…
Michelle Short: He did. Love it.
Brad Johnson: Wow. I’ve never had this happen on a podcast, like just a new guest shows up 18 minutes in. This is fun. Thanks, Keith. Let’s do this.
Derek Gregoire: He has a backdrop.
Brad Johnson: This is great. So, Keith, to catch you up, welcome. Wow. Michelle, God bless you.
Michelle Short: Yes, it’s been a long, long journey.
Brad Johnson: I mean, it’s becoming very clear how this business has had its success.
Michelle Short: Yes.
Brad Johnson: So, welcome, Keith. So, Keith’s one of the other founders, for those that are just hopping in here. But really to set the stage, we’re talking about what were the growth metrics that mattered as you guys went through an acquisition process. And so, let’s start to maybe look at this a little bit from a spreadsheet standpoint. And I think the biggest thing is, one of the things I’ve seen is if a bus hits Derek or Keith and the business is over, the hit-by-bus test, you’re not very valuable for someone else to purchase. So, what are the things that you all have done as an organization where it isn’t all based on the founder or one individual as a salesperson, and maybe some of the other metrics or learnings along the way as you guys went through this process?
Derek Gregoire: Well, the main keys, I’ll kind of answer a little different question and let Keith and Michelle answer that specific one. But the main keys, when you’re looking to, like, be acquired, I would say, obviously, they want to make sure there’s a plan after you. Now, for us to do that without any help would’ve been tough because it’s not like our team, we could say, “Hey, do you want to buy the business?” You know what I mean? It’s just not really a reasonable thing to ask. So, there was, “How do you ever do that?” So, this was a help to kind of get us some liquidity over time but also allow the next generation to be able to come upstream and build up into future potential CEO and CFO roles.
If, let’s say, in 10 years, Keith and I want to do something different, or we want to retire, whatever the case is, we want like a next… We wanted something, a succession plan in line. So, they want to see that. They definitely, obviously, ask that under management matter. Like I would say if you had… You can obviously, I’m sure, be acquired for if you had 100 million. But obviously the multiples usually get more as you have a billion than if you have 2 billion and 3 billion, right? So, that’s another factor is having a certain amount of assets under management. And then the third factor is growth. And so, how much are you growing at? 4%? You’re not going to get a crazy multiple. You’re growing at 10%? Pretty good multiple.
Are you growing at 15 or 20? With all the other things combined, that’s how you can kind of maximize an exit. So, there’s a lot that goes into that, and obviously, I think they like that we’re fairly young. We plan on being here for several years. You know what I mean? We’re not like, it wasn’t like a sale “All right, we’re retiring,” but it’s more of like just a next phase of our business, if that makes sense.
Brad Johnson: Yeah. Just for those that aren’t familiar with your business, what was your AUM at, at the start of the acquisition process, and what was a kind of a metric for your annualized organic growth? What was that coming in at?
Derek Gregoire: I think we were just at or within a fraction, right around 2 billion. It might’ve been like 2.01 or 1.95. It was right around 2 billion of AUM. Probably had a $500 million block of annuity business. And our growth rate, I believe, was between 15 and 20. Does that make sense?
Brad Johnson: Yep.
Derek Gregoire: Michelle?
Michelle Short: Yeah. I think.
Brad Johnson: I’ve seen very consistent growth from you all over the years, and obviously the bigger you get, the harder it is to grow at those clips. Like, if you go back the last four or five years, was that 15 to 20 pretty consistent annualized growth?
Derek Gregoire: Yeah. On our EBITDA, which is basically a form of net revenue, obviously. That was our metric we’ve been tracking. And we did negotiate to leave a little bit more on the table, to bet on ourselves more for future growth as well, which is kind of a… We’ve always bet on ourselves. We’ve always invested in our company, and so that still rings true. But the main metrics people, those things you mentioned earlier around AUM, around infrastructure, around growth, those are three main things, but obviously there’s more that goes into it than just that. But I would say those are three of the main metrics that we heard over and over again. Wouldn’t you agree, Keith?
Keith Ellis, Jr.: Yeah, definitely. The fact that we built, with Michelle’s help obviously, and Derek, Matt, and myself, the leadership team, they like the fact that we had young infrastructure, that if we ever did step away, they could start to work on building a succession plan within our firm. And each one of the people that deal with clients, were client facing, follow the same process. So, processes, I think, are also a big metric that if you have a good solid operations process, sales process, and just ways to deal with clients and client retention, I think that those are also other metrics that I think play a big factor in it.
Brad Johnson: So, just to recap, and then I want to get Michelle’s take because she’s probably going to see this from a slightly different angle. So, what’s the plan after you, the founder, having a decent-sized block of AUM, which obviously drives a lot of the acquisitions in the space? And then some sort of organic growth that they can see that’s not just a fluke, but it’s actually been a trend over years, and obviously a plan to continue that after acquisition, because that’s what they want. Did I miss anything there that you guys rattled off?
Derek Gregoire: One of the random things that everyone brings up, too, and it’s a way we’re measured now a lot, is net new assets. So, a lot of people just track by how much did you bring in, but net new assets is a really good way to measure it because it tracks what you brought in minus clients who left minus withdrawals, so it’s market neutral, but it’s just a true, good way to track just instead of total production. If you brought in 100 million but you lost 120, well, if you’re just tracking the 100, what use is it, right? So, we have a different way to track now.
Brad Johnson: So, net new assets, did they take out market growth out of that, and it was just…?
Derek Gregoire: Yep.
Brad Johnson: Okay, so minus market growth. And then obviously if you’ve got people in the accumulation phase that are younger, they’re going to be contributing. If you’ve got people that are older that are retired in the distribution phase, they’re going to be pulling out, so that’s going to be the balancing act there is do you have more coming in than is going out? And that’s been…
Derek Gregoire: Exactly.
Brad Johnson: Yeah, okay.
Derek Gregoire: Yeah.
Brad Johnson: Michelle, what are your thoughts? What’d you see from your side that changed?
Michelle Short: Absolutely. Yeah, no, I was going to say too, they really look, like you guys had mentioned, the infrastructure. Do we have that G2, G3 level of teammates? And they’ve interviewed our team, and it was neat for them to say, “Wow, you guys have everything in place. You’ve got your policies, procedures, but you have your tech stack. You have your career tracks for your team.” That was an easy lift for them because it’s already established, so I think knowing that we have the right people, we have a pretty lean team, just knowing that everything was kind of in place and that it was being managed is great, because they do focus on Derek, Keith, Matt, to just produce.
We have eight producing advisors, but they’re still producing. That’s what they want, you know? That’s what they’re good at. So, it’s just knowing that the org chart was in the right position, I think, was attractive for them as well.
Brad Johnson: And those that aren’t familiar with your model, because people might just be hearing about you the first time on this conversation, one of the things that we’ve touched on in prior conversations on the pod, and we can link to those, is the fact you’ve really built out like an advisor pod structure. So, it’s not just Derek or Keith or Matt or the other advisors on your team selling, servicing, planning, wearing all three hats. You’ve really kept the salespeople with the sales hat, riding shotgun with the service advisor, or two if they’ve reached books of business of these two’s size. And then the planning is its own division that’s just kind of manufacturing the financial plans, right?
Michelle Short: Exactly.
Brad Johnson: How did that hit? Because I see that to be one of the biggest gaps with a lot of firms when we meet them is one advisor kind of running the whole thing by himself, maybe with like a new businessperson on the side. When you guys were going through these acquisition conversations, was that like, “Wow, this is rare. This is what we want”? How did that impact those conversations? Whoever wants to jump in, go for it.
Keith Ellis, Jr.: Yeah. I think they looked at it as it’s something that they want. They love the infrastructure. They love the fact that the people that, for lack of a better way of putting it, can acquire clients and speak to clients, because that’s not a skill that everyone has, are the client-facing, and they’re just seeing those new clients, new clients, new clients. So, having those defined roles and, like you said, building the team pods, like Team Keith, Team Derek, Team Matt, and then having the service infrastructure behind us, they love that idea because, again, I’m client-facing. Our team’s doing a lot of the service work, rollovers, things like that. So, it creates a better client experience in a more…
Derek Gregoire: Well, Brad, think of like if you were…
Keith Ellis, Jr.: And that’s why our client retention is so high.
Derek Gregoire: This is what we used to do. We’d just, like, if our calendars and let’s say Keith and I had 200 clients each, and we were doing all the servicing, booking the reviews, planning, right? We’re capped out right there. And so, a lot of people say, “Well, we need to hire another person to do all those same things,” right? And then you’re going to go back to McDonald’s about who makes the hamburger, who is cash register, and all that. Basically, the thought process there is like, well, if Keith, Matt, myself, Mark, Chase, Mike, Pat, those lead the sales advisors, if we’re good at acquiring clients, and that’s not easy to teach, why don’t we just keep doing that?
And so, like Keith and I always have an advisor in a meeting with us on a first, and then over time they’re in every meeting. They start taking more of the ownership on of the client relationship. They’re making the calls. They’re working with the planning team. They become that point person. It just happens naturally. And then Keith and myself can kind of exit that, and we can still see them or if we need to make a call or if something. If it’s important, they want to meet with us, we can, but really, really we don’t need to at that point. So, at that point, myself or Keith or anyone in that role, if we like to sell and bring on clients and we feel like we do a decent job at it, we can keep staying in that role, and we could at some point have 20 different…
You know, there’s no limit to how many service advisors you can have, and they’re happy filling up their calendar. They’re building a nice book of business for themselves underneath that advisor as well. So, it works. It’s a really kind of a nice path that’s worked extremely well for us, and I think we just tested it a few years ago, and then as we’re like, “Wow, this is amazing,” we just kept doing more of it and expanding it.
Brad Johnson: Yeah. Well, I see a couple of things happen that you guys have fixed, and I remember way back when, when you were wearing all the hats- service, sales, planning. At one point you said, “We’re good. We’re tapped out. We’re just going to kind of lifestyle it this year.” And I remember that was what kind of unlocked this service team model that allowed you to continue to grow and actually not hate your life, which is kind of key as a business owner. But a lot of advisors, they just take their problems, and then they just pass them to the next one in line and offload C-level clients or whatever, but they don’t actually fix the core problem, which is I’m wearing three hats at one time.
So, what I love about your structure, it allows growth, but it also allows every team member to actually still have a life too and just specialize in their role, to use Michelle’s word again. And by the way, your clients get taken care of better because when you’re running appointments all day, and you’re not answering emails, you’re not taking service calls, so now you actually have a better business model for your clients as well. Michelle, how has this played out? And maybe not just on the advisor role, but just on the ops side when you go back through the lens of acquisitions, what were some of the levers or metrics that you all had put in place that were found valuable in the open marketplace?
Michelle Short: Oh, yeah. I mean, honestly, all of the metrics, I would say, knowing our numbers is a big deal. They can ask me any question, and I know my numbers. We know what the trends are. We know the ROI on every single thing that we measure here. We know that our clients are being taken care of from whether it’s a client review standpoint or their RMDs. Everything is at my fingertips, so our team does a fabulous job of just knowing their numbers. I mean, we’re now in a corporate world, right? So, we’re going from that small business feel to a corporate world. The fact that we were ahead in that sense was very attractive to them, I would say. And knowing we’re now in an HR world, right? So, we have an HR team behind us. It’s quite different.
Brad Johnson: Uh-oh. Watch out, guys. This might be trouble for the other two guys on here.
Michelle Short: Yeah, it’s a different animal, right? So, it’s like knowing that we’re doing all the right things. Our team is getting quarterly reviews. Our team knows exactly what their compensation plan looks like. Our team knows what their career track is here at SHP. So, having all these systems in place was very attractive on that side. Knowing what technology we’re using and why we’re using it and the due diligence behind that, again, very attractive on that side. So, those are the key metrics. I’ll speak for Nick too. He has a real good pulse on his team and what clients are doing what for rollovers, all those RMDs, the metrics I just mentioned. I mean, Nick and his team are super dialed in on that lead flow.
Tasha and her team on the business development team, we know what leads are coming in, how long they’re staying. I mean, we’re tracking everything in every single department, and I do think that was attractive as well.
Brad Johnson: Thanks for rattling those off. And I think I heard a long time ago, numbers never lie. And I think a lot of times businesses run their businesses on emotions, not math. And I remember in your all’s journey. When I met you, 2012, I think, was the year. So, instead of BC, it was Before Michelle. That was kind of how I tracked your business.
Derek Gregoire: BM?
Brad Johnson: Yeah, BM. Before Michelle, when times were tough. But before Michelle, one of the benefits, you had really good marketing. You were early to radio. You were on a very big station, probably the biggest AM station in Boston, right? Red Sox, I think. Did they carry the Patriots too?
Derek Gregoire: No.
Michelle Short: No.
Brad Johnson: Just Red Sox.
Derek Gregoire: Yeah, not even the Red Sox, but good try.
Brad Johnson: No. You guys were on the same station the Red Sox were on.
Derek Gregoire: We were?
Brad Johnson: Yes. I remember you took me up in the announcer booth at a Red Sox game.
Derek Gregoire: Maybe, right?
Brad Johnson: Yes. Okay. Anyway, we’ll take Keith on this one, Derek.
Keith Ellis, Jr.: Yes, Brad, we were.
Derek Gregoire: I’m going to pass that one out.
Brad Johnson: So, anyway, you had your marketing dialed in, but what I remember, this was, I don’t know, probably five, six years ago, you were tracking your marketing ROI, and radio just wasn’t returning like it used to. Obviously, a lot of people weren’t even listening to radio anymore.
Derek Gregoire: Yeah
Brad Johnson: And a lot of advisors I’ve seen get emotional like, “Oh, radio, it’s like it’s an ego play,” or, “My name’s on a billboard,” or whatever, and you’re like, “This math isn’t checking out.” So, you made a different business decision and reallocated those marketing dollars elsewhere, and I think a lot of people don’t run their business that way. And if some third-party acquirer is like, “Hey, I’m going to give this company millions of dollars,” they want to make sure those millions of dollars are being spent well. So, back to the numbers, that stuff really, really matters. I’m curious, back to process and something I’ve seen really impact your all’s business, you build a true CFP standard plan, the SHP Retirement Roadmap, very dialed in.
You don’t just sell it, you deliver on it. How did your all’s client retention, referral rate, average investable assets, which I know is pretty high at your firm, how did those compare to maybe other firms when you were going through the acquisition process? Did you see benchmarking and where you all were in comparison to others?
Derek Gregoire: Our referrals are like, I’ve said this for years, that’s our key secret ingredient, is because all the little details that are being done behind the scenes, people can tell how your business is run. Even though they may not see us tracking every number and all that, all those tracking, we know how many, what percentage of. We can tell you every team’s percentage of RMDs year to date right now, what percentage of annual reviews. Why? Because we want to make sure everyone has an annual review, and we don’t want people to get lost in the shuffle between the events, between the CFP process. When we have CFPs on our team, clients that have over a certain amount of assets have a full review.
Sometimes they come in the room. Sometimes it’s all written out in 10 pages, but it’s like they’re seeing all this being done for them. And their referrals are staggering. Like, even a couple weeks ago, it was 30-something million dollars or something, and most of it, it was all over the place. But it’s like there was a big client there, but then it was all these clients. I get so many emails of clients in like two days, three days, and just it stacks up. So, the referral numbers, I mean…
Michelle Short: Well, we just did our ROI, Derek, right? So, Q2 ROI referrals, 76% of our business.
Brad Johnson: 76% of your business in Q2 2026 was referrals?
Michelle Short: Correct. Yes.
Derek Gregoire: And I don’t know if you have that number, Michelle.
Brad Johnson: Do you mind sharing? I know we’re on a public podcast here.
Derek Gregoire: Between client referrals, prospect referrals, and client referrals, that had to be… How much were we at, at that point? Do you remember? Through July?
Brad Johnson: Total assets?
Derek Gregoire: Like, I’m saying, even I’m talking just from referrals, so I know I think…
Michelle Short: I can pull it up, but yeah.
Derek Gregoire: Like marketing TV, we’re around 40-something midway through the year. Clients doing new assets is a huge part of our business, because we have so many. Like, client got a huge payout from work for $7 million. This client had a referral, a 401(k) rollover. That’s a huge part of our business is just existing clients, but the referrals, we kind of categorize it into three areas. We have client referrals, four, prospect referrals, employee referrals, and professional referrals, like attorneys and CPAs and whatnot. So, those categories, it’s a big number, and I was like, compared to where it was five years ago, it was night and day, and every year it increases.
Brad Johnson: So, just to earmark some numbers there, 76% of new assets gathered in second quarter of 2026 was referrals. Michelle, do you have an idea, like what was your total, either year-to-date or second quarter assets gathered? Any ideas there, just for context?
Michelle Short: I mean, Derek, you refer, we’re at 246 right now.
Derek Gregoire: 246 was… And remember, that’s tracked as net.
Brad Johnson: So, 200. So, August 13th of 2026, 200…
Derek Gregoire: Yeah, 246, that’s net assets, not gross.
Brad Johnson: Net new as of today or as of end of second quarter?
Michelle Short: End of second quarter, July.
Brad Johnson: Okay. So, I’m guessing it’s probably gone up a little bit since then.
Michelle Short: Yes.
Brad Johnson: Very cool.
Keith Ellis, Jr.: Yeah. If we were tracking it the old way, we’d be at like what? 350 million, 400 million?
Brad Johnson: And why do you say that? So, how did the net new tracking change from old way to new way? Because there’s probably a learning there in the acquisition.
Derek Gregoire: Because we were just tracking like we didn’t even track withdrawals or clients leaving. We just tracked… So, if someone bought it, like we just tracked new dollars coming in from every source. So, last year was what? 400 million. This year, like Keith mentioned, we’d probably be, because we’re tracking this year based on what last year’s would’ve been if we tracked net. If that makes sense. And we’re way ahead of that. So, if last year we were over 400 gross, thinking this year, at this point, we’d probably be 350, like Keith said right now, so.
Brad Johnson: Got it. So, learning, I want to double down on this because as we’ve gone through some of these conversations as well, you see how the external market values. So, I think growing up in the insurance space that’s now become the wealth management space, it’s all kind of come together. It’s like I gathered this amount of assets for the year.
Derek Gregoire: Yep.
Brad Johnson: What changed? Net new. I gathered this amount of assets for the year, but I had clients take 40 million of distributions out, or a couple of clients left, so subtract that. Now that’s how we get measured based on our acquire.
Michelle Short: Right.
Derek Gregoire: Exactly.
Brad Johnson: Cool. And you guys have a high retention rate, so I don’t think you lose a lot of clients. Is it mainly you’ve got some retirees with distributions coming out, and so that’s coming off the top?
Derek Gregoire: Buying houses, RMDs.
Keith Ellis, Jr.: RMDs
Brad Johnson: Yeah.
Keith Ellis, Jr.: We live in the Northeast, and a lot of our clients don’t want to be here in the winter. So, they go buy a house down south.
Brad Johnson: Got it. So, a lot of second home purchases. Well, how does that work? I’m curious, being an annuity guy, how does the distributions work on the annuity side? Is that being tracked where, “Hey, I put a million dollars in annuity,” and they’re kicked on an income rider? They’re not tracking that.
Derek Gregoire: No, we’re not tracking that. We’re tracking our net AUM plus any annuity production is kind of how we track it.
Brad Johnson: Got it. Got it.
Derek Gregoire: New annuity production that has… So, withdrawals aren’t impacted in that. But I think the moral of the whole story isn’t to certainly not brag about numbers, but really to share about what’s possible as you keep doing a lot of little things right. And so, I really think it comes to how many little things does… Just remember when Keith and I just met Michelle, and she came in 2014, we didn’t do a lot of little things right. We sold, we answered the phones, we did this. And then like, oh, what’s the little thing we change? Oh, well, we don’t answer the phone anymore. We don’t book our own appointments anymore. Keith was in disguise.
Michelle Short: He did Matthew’s voice to answer the phone.
Brad Johnson: Okay, you have to answer this honestly, guys. Did you guys ever answer the phone yourself and change your voice to make it sound like it wasn’t you?
Michelle Short: Yes.
Brad Johnson: You really did?
Derek Gregoire: Keith definitely did.
Brad Johnson: Keith, you did that?
Keith Ellis, Jr.: Yes.
Brad Johnson: That’s the best.
Derek Gregoire: I heard him say hello. And then he’s like, “Yeah, one second.” He’s like this, “Hello? Hey, it’s Keith.” Put on hold for a few seconds.
Michelle Short: We all sat in one room. So, it’s a true story. We all had…
Brad Johnson: Wait, you have one of those recorded from back in the day? “This is Keith.”
Keith Ellis, Jr.: “Yeah. Oh, let me transfer him over to you. Oh, hello.”
Brad Johnson: That’s good.
Derek Gregoire: Then it’s like, oh, then now let’s start tracking things closer. When someone comes in the office, what happens? Let’s track that. So, my point is I think we just have a team to be able to do a lot more little things than maybe a firm just starting. And three years from now, hopefully, I guarantee we’re adding more, and that every time we’ve added like… That’s why it’s like drinking from a fire hose sometimes. Like, now I got to track all my numbers, now I got to build a process. And so, I think you just keep chipping away, and there are people probably 10 years ahead of us that have 400 more little things they’re doing in touches, and planning people, and in-house attorneys, and whatever the case may be that we’ll be doing in a few years.
But it’s one of those things that I think it’s just like, don’t try to drink on a fire hose. Just realize every little incremental thing you do pays off. We just see the compound effect of many years of doing that. You know what I mean?
Michelle Short: Yeah. It’s like be intentional with your team. And honestly, trying to get your team to wrap their head around it too, and sip the Kool-Aid, right? So, it’s like, how do we motivate them to want to motivate the bigger picture? So, culture’s a huge thing. I know we’re going to talk about that at the table as well. It’s like making sure your culture fits, your internal culture with your team or your external culture with your clients. So, everybody is on the same page, and everybody’s wanting to see their growth together.
Brad Johnson: Yeah. Well, on that note, I think one of the things the three founders did well, and then they passed that baton to you, Michelle, is you guys hired A-players. You have a great team that cares, and that is how you can build a business that doesn’t just depend on you, the founder or the COO. And then motivate them. Here’s where we’re running, and here’s how we get there, and here’s how we all win together. So, as we wrap here, also I want to say thank you, because I think a lot of people in our business, there can be scarcity mindset or there can be abundance mindset. And scarcity mindset, I’ve seen it a lot unfortunately over the years where it’s like, “This is all mine. I’m not telling anybody. I don’t want anybody else to find out.”
And you guys from day one at Triad have been nothing but abundance. “Hey, here’s what we’re doing. Do you want this? Here, I’ll send you the spreadsheet. Do it this way. We learned it the hard way.” And to double down on the table, I wanted to have this conversation prior to that because I’m incredibly excited about this. I can promise you this, there has never been an experience in finance, a training like this. And I am going to set the expectation high, because I know who y’all are, and I know how you share and serve. And you wouldn’t brag on yourself, but I’ve seen you as a company over the last year go through one of the most successful exits I’ve ever seen happen in this space, that includes both insurance, wealth management.
And I just want to say thanks for being willing to open up the playbook, say, “Here’s what we learned. Here are the metrics that matter.” I know we’re going to break that out into sales, marketing, ops, vision, culture, and everybody in that room’s going to get better because of you being willing to share your journey. And I think we’re going to do a little family reunion. We’ll do a fun little celebration, because I want to be able to celebrate you guys too. It’s something that deserves to be celebrated. So, any closing thoughts from you all as we wrap the conversation?
Derek Gregoire: No, thank you. I mean, it’s obviously been a crazy journey, and it continues. But we’ve always had a vision. Like, you don’t think of it, but as we’ve gone on and you have time to reflect on the whole process of building. Hopefully in this space, we’ve made a little dent in terms of helping other firms serve their clients better, build a better environment for their team, a better work environment, better culture, right? Because that’s what it’s all about is just to have something that you think is pretty good and to keep it all inside. There’s so much business out there. If you have one nice development in one town and that’s your entire client base, you’re probably doing okay, and that’s one street in a small town.
So, think of that whole how much business is there to be had. If you can keep improving the process and leveling everyone up, it’s only going to be better for the industry as a whole. So, I think we have a small dent in that, very small, but I think we’ve really tried to share what we’ve learned with other firms, not just keep it inside. And we’ve seen other firms grow and see them enjoy the fruits of their labor and things that we learn the hard way. So, that’s awesome for us to see. Michelle’s done a great job.
Michelle Short: It’s so fulfilling. You’re totally right. It really does fulfill us to see the success of others and really share. We definitely don’t even have it all figured out today, but we’re always rolling up our sleeves and trying to level up ourselves. So, to be able to share that is just thank you for allowing us to do that, and we just love watching the growth of everybody else too.
Brad Johnson: Yeah.
Michelle Short: Yeah.
Keith Ellis, Jr.: Yeah. I think it’s kind of cool to see these firms that we, kind of lack a better way of putting it, have had an imprint on double in such a short period of time. And double again. It’s fun to watch
Derek Gregoire: Brad, I have to say, I didn’t think it was possible when I saw a double cheeseburger sliding out my window onto the highway many years ago. But we’ll save that story for Table.
Brad Johnson: So, the old inside joke. Now we have to share it. So, there’s your teaser. We’ll share it at the Table. We’ll share the…
Keith Ellis, Jr.: Can we call it what it is?
Brad Johnson: I think it was a quarter – it was a quarter pounder with cheese, wasn’t it?
Keith Ellis, Jr.: Can we just name it?
Brad Johnson: Oh, it was a double cheeseburger?
Keith Ellis, Jr.: The double cheeseburger. That’s what it was.
Brad Johnson: Okay. We’ll share that story because I know everybody’s on a cliffhanger. What is Derek talking about? So, opening night of Table, Casey, put it in your notes. We’ll unpack that story and what it meant to your all’s business.
Derek Gregoire: No way.
Brad Johnson: And, Keith, I want to apologize. This is the longest Keith and I have had a conversation and not talked about sports cards.
Michelle Short: True.
Derek Gregoire: Yes.
Brad Johnson: Oh, yeah. Does Lenny have one of his $30,000 packs in there that you want to throw on camera?
Keith Ellis, Jr.: Well, Derek’s getting in Lenny’s room
Derek Gregoire: There’s a whole set of cards. All his drawers are right at my disposal, and I know nothing about it.
Brad Johnson: Hey, your dad was ahead of his time. I mean, this man literally has sealed baseball packs from the ’50s and ’60s that have gone up exponentially. He was where you got your investing. We actually just want to talk to Lenny. Bring Lenny on here.
Derek Gregoire: You know what’s funny? Yeah. So, our house is halfway to being built. We had a slight delay. We’re staying at my parents’ house. That’s how successful I am. I’m living in my parents’ basement with my wife and kids. But the funny… So, he had the AC break in the house, and he’s like, “Oh, I’m going to…” This morning I was talking to him. He’s like, “I’m going to the bank to the safe to get a…” He’s like, “I bought three whatever Kyrie, Anthony Davis rookie year packs were, and I think I need to raise a few thousand bucks for the AC. So, I’m going to grab one of them, and ship it out today.”
Brad Johnson: So, he’s like, there’s people that deal in only cryptocurrency and Bitcoin. He only deals in cardboard.
Derek Gregoire: Yeah, I’m like, “Do you have any money?” and he’s like, “Here’s a card.”
Brad Johnson: That’s great.
Derek Gregoire: That’s what he’s doing right now.
Brad Johnson: That’s awesome. Well, tell Lenny hi. I love Lenny. Anyway, love the conversation. Excited to get us all together in Kansas City to celebrate an awesome season for y’all’s business, obviously share a lot of learnings with the community. So, thanks, y’all. Thanks for hopping on.
Derek Gregoire: Happy birthday.
Michelle Short: Happy birthday.
Brad Johnson: Appreciate it. Yep. We’ll see ya.
Michelle Short: Bye.
Keith Ellis, Jr.: Happy birthday, man. See ya.
